We wholly disavow the conduct engaged in by Steve Rattner, who hired the New York State Comptroller’s political consultant, Hank Morris, to arrange an investment from the New York State Common Retirement Fund. It is our understanding that Mr. Rattner also arranged a DVD distribution deal for a movie produced by the Chief Investment Officer’s brother in the middle of the investment decision-making process. That conduct was inappropriate, wrong, and unethical. Mr. Rattner is no longer with the firm and is not a part of today’s settlement. Quadrangle will fully cooperate in the Attorney General’s ongoing investigation of Mr. Rattner and others.

According to the DetN, that stinging indictment by Rattner’s former firm has inspired House Republicans to call for an investigation into whether Rattner was behind a deal in which some Delphi retirees lost their pensions while others didn’t.
A letter from Reps Mike Rogers (R-MI) and Christopher Lee (R-NY) to the House Oversight Committee argues that the investigation of Rattner:

[calls] into question the integrity and objectivity of Mr. Rattner’s panel, particularly the decision to allow some Delphi Corp. retirees, including many salaried retirees, to lose their pension benefits through the Pension Benefit Guaranty Corporation while simultaneously protecting the benefits of other Delphi retirees.

However, that deal hardly needs a lot of in-depth investigation to get to the bottom of. As The Milwaukee Journal Sentinel explains, GM agreed to “top off” UAW pensions when it spun Delphi off in 1999. However:

The salaried retirees had no such agreement – and, it turns out, neither did employees who belonged to some other unions, including the International Brotherhood of Electrical Workers, the International Association of Machinists and Aerospace Workers, and the International Union of Operating Engineers.

When Delphi dropped those pensions on the PBGC, the 70,000 non-UAW retirees saw their benefits drop by $800m. And why would Steve Rattner have changed any of that? Rogers and Lee are trying to investigate a sin of omission rather than a sin of commission. The original sin in the sad story of Delphi was GM and the UAWs… all Rattner had to do was not fix it.

We sympathize when Rogers says:

It was completely unfair how they were treated… We need to ask some really hard questions about how this happened.

But just because Rattner screwed up at Quadrangle doesn’t prove anything about Delphi. That situation was screwed up long before Steve Rattner arrived.

Rattner’s a deal maker. I was never able to find out what he was doing at the NAIAS this January, since he supposedly left the PTFOA last summer. Treasury said he wasn’t there on their behalf. When I asked him , when he was walking with Sergio Marchionne, about his credentials saying “GM” he said “That’s what they gave me.”